Peroxisomal and mitochondrial beta-oxidation are two principal pathways of fatty acid oxidation which regulate the nature and concentration of intracellular acyl-CoA and energy rich molecules. The integration of these two systems permits the animal to adapt to a wide range of nutrient composition without suffering from hyperglycemia or hyperlipidemia. This application proposes to investigate the role of these two pathways in the adaptation to nutrient composition and in the development of obesity and diabetes in the Zucker obese and diabetes model. Specific Aim 1: Test the hypothesis that the contribution of peroxisomal and mitochondrial beta-oxidation varies depending on the chain length and desaturation of the fatty acid (nutrient specific). Specific Aim 2: Test the hypothesis that two hormonal systems (insulin and leptin) affect fatty acid synthesis and oxidation differently to regulate gluconeogenesis and lipogenesis. Specific Aim 3: To examine peroxisomal and mitochondrial oxidation in obesity and diabetes using Zucker obese and Zucker diabetic models. Specific Aim 4: To test the hypothesis that the effect of PPAR ligands on fatty acid oxidation interacts with the leptin receptor signaling pathway to improve both glucose and lipid metabolism. A key feature of this proposal is the use of [1-13C]- and [U-13C]-fatty acids and mass spectral technologies to determine the relative contributions to the acetyl-CoA pool from fatty acyl chain shortening and elongation (peroxisomes) to mitochondrial beta-oxidation. These studies should provide new conceptual and experimental tools for the study of fatty acid oxidation regulation, a central issue in the pathophysiology of obesity and Type II diabetes.